SoundCloud stays alive with $169.5 million investment deal, founder steps down as CEO

“The investment will ensure a strong, independent future for SoundCloud.”

SoundCloud has secured a crucial $169.5 million investment deal from global merchant bank The Raine Group and Singapore-based investment company Temasek that will enable it to stay afloat.

Writing on its blog today (August 11), the cash-strapped streaming platform said “the investment will ensure a strong, independent future for SoundCloud, funding deeper development and marketing of its core tools used by millions of audio creators.”

The streaming service has also revealed plans to replace long-time CEO Ljung – who has headed up the company since 2007 – with “veteran digital media operator” Kerry Trainor. Michael Weissman joins the team as Chief Operating Officer, while Ljung will take on a new role of Chairman of the Board.

According to Variety, the new investors will acquire more than 50 per cent of the company. Last month, SoundCloud terminated the contracts of 173 staff members amid reports that it only had enough money to stay afloat until Q4, which begins on October 1. Company co-founder Alexander Ljung later issued a statement denying the claims.

SoundCloud’s financial troubles have been widely reported over the past few years. In 2016, it emerged that the company lost $44 million dollars in 2014, while this year, reports showed that it suffered a $52 million loss in 2015.

SoundCloud stays alive with $169.5 million investment deal, founder steps down as CEO

“The investment will ensure a strong, independent future for SoundCloud.”

SoundCloud has secured a crucial $169.5 million investment deal from global merchant bank The Raine Group and Singapore-based investment company Temasek that will enable it to stay afloat.

Writing on its blog today (August 11), the cash-strapped streaming platform said “the investment will ensure a strong, independent future for SoundCloud, funding deeper development and marketing of its core tools used by millions of audio creators.”

The streaming service has also revealed plans to replace long-time CEO Ljung – who has headed up the company since 2007 – with “veteran digital media operator” Kerry Trainor. Michael Weissman joins the team as Chief Operating Officer, while Ljung will take on a new role of Chairman of the Board.

According to Variety, the new investors will acquire more than 50 per cent of the company. Last month, SoundCloud terminated the contracts of 173 staff members amid reports that it only had enough money to stay afloat until Q4, which begins on October 1. Company co-founder Alexander Ljung later issued a statement denying the claims.

SoundCloud’s financial troubles have been widely reported over the past few years. In 2016, it emerged that the company lost $44 million dollars in 2014, while this year, reports showed that it suffered a $52 million loss in 2015.

Thanks for the update Enoch. That's great news. Not just the investment but the change of the operational leadership. A CEO for a startup may not be the ideal CEO for a large company (and vice versa) - but it is a difficult thing to come to terms with. It will be interesting to see what happens in the next 12 months!

Hopefully they will now upgrade the quality of their streaming service? They probably lost so much money because people were not prepared to subscribe to such a low quality service.
I tried the 'pro' deal and honestly it sucked for what they were offering.